Federal Law No. 214-FZ: the essence of the law on participation in shared construction, the current version

Recently, the acquisition of real estate by concluding a share agreement becomes extremely urgent. Legislatively regulates the process of participation in shared construction No. 214-FZ. The essence of the law will be discussed in detail in the article.

On the subject of regulation of the Federal Law

The introduced Federal Law was created to regulate relations, closely related to attracting financial means of citizens for the construction of apartment buildings. Involvement of money investments occurs on a shared basis: in fact, each candidate for housing "takes off a share" to build a house.

Shared construction is, it would seem, a very simple, but at the same time very ambiguous process. Recently, cases of deceit of citizens registered as holders have become more frequent. In order to prevent such machinations, 214-FZ was developed. The essence of the law is very simple: strict fixing of norms that would allow for qualitative implementation of the processes of construction of a shared character.

About the developer and home

Article 2 of the normative act in question establishes two basic concepts that are used in all subsequent provisions of the law. The first term is a "builder". According to the law, developers refer to legal entities that own a land plot on which to build a residential facility. The developer receives a special permit for development, and then begins the process of attracting finance.

The object of shared construction is always the accommodation of residential or non-residential type, which is subject to transfer to construction participants on a shared basis. It should be noted that such facilities can not be enterprises that are of an industrial nature.

The essence of the law 214-FZ, therefore, is to consolidate the rules relating to shared construction.

On the right to attract finance

It has already been noted above that the process of raising funds can not be started without obtaining a special permit. What is the reason for this? It is worth recalling the essence of the law 214-FZ. It is about minimizing the cases of fraud and financial fraud. That is why in Article 3 of the normative act, the norms are fixed, according to which the developer is able to raise money only after completing the declaration for construction, and also after the registration and registration of a number of land-building measures. The developer is obliged to answer the date of sending the project declaration, as well as its requirements. Only in this case it will be possible to begin the process of attracting the funds of equity holders.

Here, too, the following requirements for developers:

• Installment capital must be fully paid;
• The developer should not be subject to liquidation as a legal entity;
• There should be no decision by the arbitration court to suspend the developer;
• The developer should not be in the register of unscrupulous developers;
• The developer has no arrears in taxes, debts or fees.

Further, it is worthwhile to talk about a special agreement, which is concluded between developers and co-investors.

Contract for participation in construction

Article 4 of the normative act in question contains quite detailed provisions concerning the conclusion of a treaty. It is worth noting that the essence of the law 214-FZ is the strict consolidation of all possible legal processes related to construction on a shared basis.

According to the law, one party to the contract is obliged to build a residential object in the specified time, and the other party - in a timely manner to pay the price specified in the contract. What elements should the contract contain?

• Firstly, this is the definition of a particular construction site, as well as all the information about it.
• Secondly, the terms of construction and the price of the contract.
• Another important place in the contract is taken by guarantees and ways to provide the developer with their obligations.

About terms and guarantees

What is the essence of 214-FZ? The act in question is designed to fix the maximum number of norms, thanks to which the process of shared construction would pass as efficiently as possible. Article 6 of the law refers to the timing. So, in the developer's responsibility is the timely transfer of the construction object to co-investors. In case of breach of contractual obligations, the developer is obliged to pay to the affected parties to the transaction the amount of the three-hundredth part of the refinancing rate, which is established by the Russian Central Bank. The developer has the right not to pay penalties only if the other party refused to sign the transfer act.

The developer is obliged to warn co-investors about possible problems. So, if there is no possibility to complete the construction of the facility by the established date, no later than two months before the date prescribed in the contract, this should be known to all parties to the contract.

About the requirements of the contract

For poor performance or complete failure to perform their duties on this or that side of the contract, responsibility can be assigned. In accordance with Federal Law No. 214, the substance of which is examined in this article, the guilty persons will have to pay fines, penalties or forfeits.

Article 11 deals with the assignment of rights under a treaty. It is possible only after the participant in the shared construction has paid the price of the contract, or transfers the debt to a new participant in the construction.

When can the obligations under the contract be considered fulfilled? According to Article 12 of the Federal Law under consideration, only after full payment of the established amount and signing of the transfer document.

About the project declaration

One important document plays an important role in the entire process of shared construction. In Article 19 it is referred to as the project declaration. This document includes all the necessary information about the developer and the construction site. Some provisions of the project declaration copy the contract of the participants in the shared construction, but only the most important ones. Basically, the declaration contains purely technical data. All of them must be certified by the executive authority of the respective region even before the developer enters into an agreement with the first shareholder.

It is also worth noting that any legal consequences for the developer itself are possible only after certifying the facts from the project declaration. The form of the document in question is established by the authorized executive body of the subject of the Russian Federation.

The essence of 214-FZ "On participation in shared construction" (the current version of 2013) is also to disclose the purpose of all relevant documentation.

On state regulation

State control is particularly important in such a large area as the acquisition of real estate. In Russia, such control is manifested in the form of a set of individual functions. This is what Article 23 indicates:

• The right to request from developers all the necessary documentation and information on the progress of work;
• Formation and publication of normative and legal acts concerning share construction;
• Development of separate methodological documents and recommendations on issues of state control in the field of construction of a shared type, etc.

So what does the Federal Law 214-FZ contain? The essence of the law is simple: the consolidation of norms, according to which the emergence of complexities in the field of shared construction would be practically impossible.